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In their latest report, the analysts cite a recent Oppenheimer survey of 1,800 US-based Netflix customers which showed “healthy propensity to pay for ‘remote’ users,” and demonstrated that “some abandoned users are willing to pay for their own subscription.”
As the company is set to pull the plug on password-sharing, the poll demonstrated that 48% of respondents said they currently support ‘free’ users outside their household, and 45% said they’re happy to pay for remote users, “suggesting potential for ~36M new subs,” based on ~75M US subscribers.
Furthermore, “55% of account owners have no willingness to pay for extra households, representing 20M of potential “ad-tier” subscribers. In addition, 27% of account owners willing to pay $6.99 (Standard with Ads account) for at least one “remote” user adding 10M subs. Combined this equals ~30M potential new subs.”
As such, the analysts maintained an Outperform rating on shares, and raised their target to $450 “because of the multiple tailwinds, including decreased competition, long term unwind of linear TV, the launch of advertising & password sharing.”
NFLX closed at $355.99 yesterday, and is up over 20% YTD.
